In a notable development, Vornado Realty TrustVNO inked a lease deal with Victoria's Secret at its 640 Fifth Avenue property on 51st Street. The lease deal, for a 63,780-square foot flagship store, has a duration of 16 years. The deal is expected to be accretive for the NY-based real estate investment trust ("REIT"), going forward.
The store will include a 78-feet frontage on Fifth Avenue. Scheduled to open in Nov 2016, the store will also include 3 selling levels as well as extra space for storage or support. An adjacent store, spanning 3,230 square foot, has been retained by Vornado for leasing purpose.
Vornado is the owner and manager of commercial real estate in the U.S., with its portfolio mainly spread across the New York City and Washington D.C. areas. The latest deal reflects solid demand for space at this property. We believe the transaction will consolidate Vornado's revenue stream from this property for a long time.
Vornado's Class A office properties are concentrated over a few select high-rent, high barrier-to-entry geographic markets. The company, which had earlier been subject to criticism for venturing into too many sectors, has now taken to streamlining its business. These initiatives include the spin-off of Urban Edge Properties ("UE") earlier in the year.
Currently, Vornado carries a Zacks Rank #3 (Hold).
Investors interested in the REIT industry may consider stocks like CoreSite Realty Corporation COR , W.P. Carey Inc. WPC and Gramercy Property Trust Inc. GPT . All three stocks sport a Zacks Rank #1 (Strong Buy).
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